India, along with 20 other countries, signed the inter-governmental Memorandum of Understanding (MoU) on establishing the Asian Infrastructure Investment Bank (AIIB) on October 24th, 2014 in Beijing. All the signatory countries can become Prospective Founding Members of AIIB. The MoU is non-binding document. By signing the MoU, India is eligible to participate in the negotiations for arriving at a mutually acceptable Articles of Agreement (AoA) to constitute this Bank. The signatories to this Articles of Agreement will become the founding members of this Bank.

Expected benefits likely to accrue to India:

AIIB will be financing infrastructure projects in the Asian region. Therefore if India joins the AIIB, we will be able to access resources for the financing of national and cross border infrastructure projects, from this Bank.

The share holding of each member country will be decided after negotiations on the AoA of the Bank are concluded and the membership is finalized.

This was stated by Shri Jayant Sinha, MoS in the Ministry of Finance in written reply to a question in the Lok Sabha.

Non-binding memorandum of understanding enables prospective founding members to negotiate Articles of Agreement for a regional development bank. India signed a non-binding Memorandum of Understanding making it eligible to negotiate the Articles of Agreement to constitute the Asian Infrastructure Investment Bank; signatories to the finalized Articles will be founding members. The MoU does not create binding membership, and shareholding allocations and formal membership terms will be decided after negotiations conclude. Membership is expected to provide access to resources for financing national and cross-border infrastructure projects.